Post-Autistic Economics Review - Issue No. 14

An American Undergraduate Point of View on Economics Education

K.M.P. Williams

As an economics student who has recently had to suffer through the course material, I would like to contribute to the debate regarding "what should be kept in microeconomics".

To this end, I have posed two questions.

My first concerns the definition of economics. Widely used micro and macro textbooks define it as the study of the distribution of scarce resources. I wanted to know what future teachers, especially future social studies teachers who are likely to introduce students to economics, thought economics was. Through email, I surveyed education students at Wells College, asking them, "What is the definition of economics?" I received 16 responses. Here are some samples, the first three from students intending to teach high school social studies.

* "The way money and things representative of money are used by people. (??? who knows???)"

* "Economics is the study of income and commerce - it is the management of money."

* "I’m not entirely sure, to be honest. I guess I would say the study of the economy."

* "Economics was the most boring and un-interactive class I have ever taken of which I remember absolutely nothing!"

* "Economics is the study of money and consumerism."

* "I would define economics as the science that deals with income and expenditures."

Only one of these future teachers has studied economics beyond high school and, except for an environmental science student who wants to take Environmental Economics, none plan on studying it further.

In light of these answers, I asked myself a second question: What should be the purpose of economics education? This question connects with the first. In fact, I believe that the way economists answer this pair of questions is the primary cause of the alienation that so many students and non-economists feel toward economic theory and economics courses. Karl Polanyi’s answer to the first question was that economics is the study of how people transform nature to meet their needs. [1] This is very different from regarding economics as a distribution problem and has implications for answering the second question. Indeed, if Polanyi’s definition of economics is adopted, the mission of economics courses becomes clear-to help students understand the ’economy’ in its broadest sense. This is the position that I have come to, and from it I would like to offer a few comments on the debate begun by Bernard Guerrien. [2]

I disagree with Bruce J. Caldwell when he says that the conclusions from neoclassical microeconomics are a good representation of a ’basic economic reasoning’ that predates it. [3]

To say "we live in a world in which scarcity makes choice necessary" is an ideological statement when followed by conclusions of neoclassical economics such as that there is an economically determined ’optimal’ level of pollution, or that the intersection of some curves representing technical and allocative efficiency can ameliorate the problems of making choices about scarcity. Likewise, the assertion that "producing goods for which one has a comparative advantage permits gains from trade" is shown to be a ’not-so-covert defense of
globalization’ when, for example, mobility of capital and comparative immobility of labor are incorporated and the human costs of exploitation are examined.

I believe Jacques Sapir’s "Response to Guerrien’s Essay" [4] represents a much more coherent rationale of why neoclassical microeconomics does not need to be totally thrown out. Abstraction is not an evil to be rooted out of the discipline. But microeconomics needs to be radically changed if it is to help us understand the economy. If neoclassical theory is exposed in the curriculum for ’what it is’-a theory explaining an imaginary world-and not the ’core’ or most ’basic’ way to explain the economy [5], then students can profit from its being taught. Just as neoclassical economists are wrong to deny ’economist’ status to those outside the neoclassical mainstream, we should not make it our aim to banish neoclassical theory forever.

The way for economics to avoid alienating non-economists, especially students at the undergraduate level, is to broaden the scope of the curriculum, while at the same time going deeper into each of the issues and problems presented. Micro-theory can play a role in this.

The future teachers surveyed above may be put into positions where they are forced to indoctrinate the next generation into believing in neoclassical economic theory. As Gilles Raveaud has noted, too many people believe "economics has nothing to do with reality. Here we draw curves and manipulate equations that have no counterpart in reality." [6]
In the US, at least, students learn this in high school, and apparently it is reinforced in colleges and universities. However, if students are taught from the beginning to understand microeconomic theory critically, including how to challenge accepted ideology and to learn from that process, then progressive theories designed to someday replace neoclassical theory will have a greater chance of being relevant for everyone, not only radical economists.

As Joan Robinson once said, the reason to study economics is to avoid being duped by
economists. [7]

[1] Polanyi, Karl (1957). Trade and market in the early empires; economies in history and theory. Free Press: Glencoe, Ill.